This is the first time availability charge model PPPs
have been used for an Australian road PPP project.
What was the project?
The Peninsula Link Project brings the people of Frankston and
the Mornington Peninsula easier travel by connecting them to the
south end of East Link. The 27 km freeway standard road with 11
local road connections and more than 35 bridges cuts travel times
between Mount Martha and Carrum Downs dramatically.
The Victorian Government awarded the contract to deliver the
project to the Southern Way Consortium (which was formed by
Abigroup, Bilfinger Berger and the Royal Bank of Scotland).
What's so unusual about Peninsula Link?
The way it was delivered.
Peninsula Link was delivered as an Availability PPP, which means
that Southern Way Consortium will finance, design, build, operate
and maintain the road for the agreed project term of 25 years, in
exchange for the payment of an availability charge (by the
Victorian Government) rather than tolls (paid by users).
This is the first time availability charge model PPPs have been
used for an Australian road PPP project, which traditionally
required the private sector to assume patronage risk.
What did Clayton Utz do?
Melbourne Major Projects partners Marko Misko, Naomi Kelly and
Dan Fitts led a team which provided strategic legal and commercial
advice to the Linking Melbourne Authority on all aspects of the
Using the valuable lessons learnt from previous similar projects
over the last decade, we developed innovative tendering processes
and highly streamlined contractual project documentation, which
helped the project be delivered in record time – nine
months from the Expression of Interest phase to Contract Close. We
also helped minimise the project bid costs for both the Victorian
Government and private sector bidders.
For further information, please contact Marko Misko, Naomi Kelly
and Dan Fitts.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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